Stocks Sink to 2005 Lows

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Stocks plunged to 5 1/2-month lows on Friday, marking their third day of sharp falls, as economic growth appeared to slow in the U.S.


The Dow Jones Industrial Average fell 191.24, or 1.9 percent, to 10,087.51, after falling 125 points on Thursday and 104 points on Wednesday. It was the Dow’s lowest close since Nov. 2. The Nasdaq Composite Index dropped 38.56, or 2 percent, to 1,908.15 for its worst showing since Oct. 25. The Standard & Poor’s 500 Index was down 19.43, or 1.7 percent, to 1,142.62, its lowest level since Nov. 3.


In a market already jittery about rising inflation, the Labor Department said import prices climbed 1.8 percent in March due to the spike in crude oil prices. This marked the fastest monthly increase in more than two years and exceeded analysts’ expectations calling for a 1.3 percent rise.


Also, manufacturing activity in the New York area slowed to its lowest level in two years, the New York Federal Reserve Bank reported. The bank’s Empire State Manufacturing index fell to 3.1 in April from a revised 20.2 in March.


Among local movers, shares of Magnetek Inc. plunged 13.4 percent to close at $3.94 after the L.A.-based power electronic products manufacturer’s stock was downgraded to “market perform” from “outperform” by analyst J Steven Smigie at Raymond James.


Avery Dennison Corp. lost 11.5 percent to $53.01 after the Pasadena-based maker of labels and office products warned its first-quarter earnings would fall well short of expectations due to higher inventory reserves. The company said it expected first-quarter earnings to be about 10 cents a share below the low end of its previous forecast of 71 cents to 78 cents a share, blaming higher inventory reserves related to a new product.


And shares of Mattel Inc. fell 7.7 percent to $18.67 after the El Segundo-based toymaker said its first-quarter earnings dropped nearly 28 percent from a year ago on falling sales of Barbie and Hot Wheels brands. The company reported first-quarter net income of $6.5 million (2 cents per diluted share), compared with income of $9 million (2 cents) for the like period a year earlier. Net sales for the quarter ended March 31 rose slightly to $783.1 million from $780.9 million in the comparable period of the prior year.

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